NewsBreak: Fed Members Concerned Markets Pricing in too Many Cuts, Minutes Show

NewsBreak: Fed Members Concerned Markets Pricing in too Many Cuts, Minutes Show  | Oct 09, 2019 14:30

NewsBreak: Fed Members Concerned Markets Pricing in too Many Cuts, Minutes Show - Federal Reserve policymakers expressed concerns that markets are pricing in too many interest rate cuts, minutes of the previous FOMC meeting published Wednesday showed.

  • "A few participants judged that the expectations regarding the path of the federal funds rate implied by prices in financial markets were currently suggesting greater provision of accommodation at coming meetings than they saw as appropriate and that it might become necessary for the Committee to seek a better alignment of market expectations regarding the policy rate path with policymakers' own expectations for that path," the minutes showed.

  • Several participants suggested that the committee's postmeeting statement should provide more clarity about when the recalibration of the level of the policy rate in response to trade uncertainty would likely come to an end.

  • Since the September meeting, expectations for a 25-basis-point-cut in October have risen from below 10% to more than 80%, according to’s Fed Rate Monitor Tool.

  • In the wake of release of the minutes, the S&P 500 held onto previous gains and was up 1% on the day as the market recovered from Tuesday's slump. Interest rates were slightly higher as well, with the 10-Year Treasury yield at 1.579%, up from Tuesday's 1.539%.

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Evan Soukas
Evan Soukas

Powell do the right thing! No cut until December. A Santa Clause rally is a MUST this year. Cut too early and you'll be left with very little ammunition for 2020. Indices are cooked, and they need to correct a few more times before the bears take charge.   ... (Read More)

Oct 09, 2019 18:47 GMT· Reply
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